Plants and Productivity in International Trade

54 Pages Posted: 31 May 2000

See all articles by Andrew B. Bernard

Andrew B. Bernard

Dartmouth College - Tuck School of Business; National Bureau of Economic Research (NBER); Centre for Economic Policy Research (CEPR)

Jonathan Eaton

Leonard N. Stern School of Business - Department of Economics; National Bureau of Economic Research (NBER)

J. Bradford Jensen

Georgetown University - Department of Strategy/Economics/Ethics/Public Policy; Peter G. Peterson Institute for International Economics

Samuel S. Kortum

University of Chicago - Department of Economics; National Bureau of Economic Research (NBER)

Multiple version iconThere are 2 versions of this paper

Date Written: April 2000

Abstract

We reconcile international trade theory with findings of enormous plant-level heterogeneity in exporting and productivity. Our model extends basic Ricardian theory to accommodate many countries, geographic barriers, and imperfect competition. Fitting the model to bilateral trade among the United States and its 46 major trade partners, we see how well it can explain basic facts about U.S. plants: (i) productivity dispersion, (ii) the productivity advantage of exporters, (iii) the small fraction who export, (iv) the small fraction of revenues from exporting among those that do, and (v) the much larger size of exporters. We pick up all these basic qualitative features, and go quite far in matching them quantitatively. We examine counterfactuals to assess the impact of various global shifts on productivity, plant entry and exit, and labor turnover in U.S. manufacturing.

JEL Classification: F11, F17, O33

Suggested Citation

Bernard, Andrew B. and Eaton, Jonathan and Jensen, J. Bradford and Kortum, Samuel S., Plants and Productivity in International Trade (April 2000). Amos Tuck School of Business Working Paper No. 00-05. Available at SSRN: https://ssrn.com/abstract=223770 or http://dx.doi.org/10.2139/ssrn.223770

Andrew B. Bernard (Contact Author)

Dartmouth College - Tuck School of Business ( email )

100 Tuck Hall
Hanover, NH 03755
United States
603-646-0302 (Phone)
603-646-9084 (Fax)

HOME PAGE: http://mba.tuck.dartmouth.edu/pages/faculty/Andrew.Bernard/

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
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Centre for Economic Policy Research (CEPR) ( email )

London
United Kingdom

Jonathan Eaton

Leonard N. Stern School of Business - Department of Economics ( email )

269 Mercer Street
New York, NY 10003
United States
212-998-8951 (Phone)
212-995-3932 (Fax)

HOME PAGE: http://www.econ.nyu.edu/user/eatonj/

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

J. Bradford Jensen

Georgetown University - Department of Strategy/Economics/Ethics/Public Policy ( email )

Washington, DC 20057
United States

Peter G. Peterson Institute for International Economics ( email )

1750 Massachusetts Avenue, NW
Washington, DC 20036
United States

Samuel S. Kortum

University of Chicago - Department of Economics ( email )

1126 East 59th Street
Chicago, IL 60637
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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